8 Software Outsourcing Trends for 2022
Software outsourcing is when one company contracts another company to develop software for them. This can be done because they do not have enough resources (time, money, engineers) or expertise on their own. Software development companies specialize in software development and often offer more than one type of service, such as improving an existing system or developing a new system from scratch with the customer’s input. Outsourcing also provides access to resources such as knowledge, technology, and skills that may not otherwise be available internally at the company using the outsourced services.
In 2022, software outsourcing will continue to grow, and new software outsourcing trends will emerge. We have identified eight trends that we expect will affect the industry in 2022.
Increased demand in the world for skilled engineers
The demand for engineering talent is expected to continue to increase in 2022. There are almost one million unfilled tech jobs in the US alone. This puts outsourcing companies in a strong position because they already have large pools of engineers and are experts at locating the best engineers. However, companies that do not have engineering expertise and skills face the challenge of increasing their supply of engineers or outsourcing more to meet demand.
The demand for engineers has surge amidst the COVID-19 pandemic. In 2022, the pandemic will hopefully continue to improve, which will fuel the demand for software engineers even further.
A rise in demand for cloud-based services
Cloud-based services have been rising throughout the years, and we expect this to increase as time goes on. This software outsourcing trend is due to cloud-based services’ many benefits, such as increased scalability, speed, security, and lower costs. In addition, many companies that have begun outsourcing their software development are doing so because they see the benefit in cloud-based software services, and we expect this trend to continue.
As cloud-based services continue to rise, more companies will move to a cloud-native development model. This will allow companies to build and deploy software into the cloud instead of using traditional on-premise hardware that requires less system administration and maintenance. This will lead to a cost reduction in the long term and allow developers to be more efficient.
The shift of companies to the cloud will also lead to a rise in cloud-native software development tools such as object storage, container registries, and databases that can support them.
High Demand For Data Science and Analytics
Specialized software development companies are also beginning to emerge that focus on big data and analytics, which means we expect this trend to continue in the next five years. As more companies start outsourcing their development processes, they will seek out software outsourcing companies who specialize in this area to learn it as fast as possible. This is also seen in the rise of data science roles in software companies that outsource, meaning the demand for these services will increase.
The Rising Needs For DevOps and Agile Practices
More companies are beginning to implement DevOps and agile software development into their organizations which involves moving fast with small teams who work closely together to get the job done. This helps to increase collaboration and communication between teams, allowing organizations to react faster and be more flexible with their development process. It also minimizes the time it takes for software updates as well as helping companies get smaller projects out faster.
The Rise of Artificial Intelligence (AI) and Machine Learning
While demand has increased for artificial intelligence, not all companies have the resources or expertise to develop software independently. As a result, companies are increasingly looking to outsource their artificial intelligence work and projects. This includes hiring outsourced software development companies to develop and implement artificial intelligence into their software. In addition, many companies are choosing to outsource their machine learning-based projects because they require an in-depth knowledge of the subject area, which is typically not available within a single company.
An increased focus on security
As the importance of cyber security has grown, so too has the software outsourcing industry. According to IBM, the average cost of a security breach is $4.24 million. With new threats emerging every day, it’s becoming increasingly important to ensure that you are protecting your data and information. Therefore, it is essential to choose an outsourcing partner who has the capabilities and expertise to provide the right security services for your organization. ISO27001 certification is a great way to ensure that the company has the knowledge and experience to implement the best security measures possible.
Focus on Talent rather than Cost
Software outsourcing started to reduce costs and gain access to highly skilled workers while reducing headcount. However, with talent on the rise within many cities worldwide, companies are looking at more than just cost when choosing a software outsourcing partner.
Companies seek a complete package of services that includes expertise in their industry, technical know-how, software development experience, security capabilities, and a solid social presence. These factors play a part in helping an software outsourcing company stand out from the rest of its competitors. A software partner can no longer be picked based solely on price as it’s not enough to attract new clients, while companies cannot compete with their direct competitors if they do not have all the components in place.
Companies will look for multi-skill/specialist software outsourcing partners
Companies will look for partners that have a broad range of technology skills. A single software outsourcing company will provide consulting, design, development, testing, and deployment support. Partnering with a company that deals in more than one area and has the ability and experience to deliver end-to-end service on a project is a good idea.
Software outsourcing has become more popular as companies look for ways to reduce their costs and increase efficiency. Companies that want to succeed in the software development industry need a partner that can provide expertise and knowledge from every stage of the process.